What: Luxury brands and duty-free retailers are betting on e-commerce, trendier products, and a better shopping experience at airports to make up for the impact of the pandemic.

Why is it important: With the sales of luxury goods at airport shops down with the pandemic, since business travelers, Chinese tourists, and other big spenders are not traveling, airport retailers are testing new store formats and click-and-collect options to generate more revenue from fewer passengers. Concept stores featuring trendier products aimed at younger shoppers are competing with traditional duty-free shops.

Travelers returning to the airport for the first time since the pandemic will find a different retail landscape awaiting them past the security gate. The duty-free shops selling expensive liquor and cosmetics are still there, but they’re refreshing their assortment to cater to Gen-Z and pushing new websites and shopping apps.

Concept stores pitching lifestyle and contemporary fashion brands are popping up alongside mainstays like Dior and Prada. There are also more things to do beyond shopping, from workout classes to movie screenings.

Among the groups still missing are business travelers and Chinese tourists, historically two of the biggest spenders at airport shops. Instead, terminals are seeing young tourists, especially those making short trips, a group that will make up a majority of passengers by 2025.

These travelers aren’t big shoppers, preferring to splurge on food, drinks and entertainment before boarding their flight. On average, a long-haul Chinese passenger spends over $100 on luxury goods, compared to a short or medium-haul European passenger, who spends just $1, according to Mauro Anastasi, a retail and aviation partner at Bain & Company.

Airports are thus introducing experiences beyond shopping to cater to younger consumers. After passing through security at Baltimore-Washington Airport, travelers can make time for a pre-flight workout at Roam Fitness, borrowing Lululemon gym gear and running shoes and using showers stocked with Malin+Goetz products. At Heathrow, a pop-up Chanel store invited shoppers to try a range of the brand’s beauty products using augmented reality on digital screens.

The future of airport retail